NEW YORK, United States —  Upscale retailer Nordstrom Inc reported a better-than-expected quarterly profit on Wednesday, as its focus on online business helped offset weaker sales in its brick-and-mortar stores, sending its shares up 13 percent in extended trading.

The company has been investing heavily in its online business and loyalty programs to beat back competition from other upscale department stores and e-commerce rivals.

The 118-year old retailer has also improved offerings and worked on its inventory management as part of a turnaround plan to boost profit.

"We exited the quarter in a favourable inventory position and made important strides in productivity," Nordstrom Co-President Erik Nordstrom said.

The company said digital sales rose 4 percent for the second quarter ended August 3, although total revenue fell 5 percent to $3.87 billion.

Net earnings fell to $141 million, or 90 cents per share, in the quarter from $162 million, or 95 cents per share, a year earlier.

Analysts were expecting Nordstrom to report sales of $3.93 billion and a profit of 75 cents for the quarter, according to IBES data from Refinitiv.

By Nivedita Balu; Editor: Anil D'Silva